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Sumitomo Chemical Company (TSE:4005) has drawn investor attention after a recent period of positive share returns over the past week, month and 3 months, prompting closer scrutiny of its fundamentals.
See our latest analysis for Sumitomo Chemical Company.
At a share price of ¥535.2, Sumitomo Chemical Company has seen short term momentum build, with a 7 day share price return of 13.87% and a 90 day share price return of 23.95%. This is set against a 1 year total shareholder return of 63.28%, which highlights how recent strength fits into a broader recovery story.
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With the shares at ¥535.2, trading slightly above the consensus price target yet flagged by some models as around 53% below intrinsic value, the big question is whether Sumitomo Chemical is still undervalued or whether the market is already pricing in future growth.
At ¥535.2, the most followed narrative pegs Sumitomo Chemical’s fair value at ¥529.18, a small gap that still rests on some big assumptions.
Recovery in profitability across key segments (Agro & Life Solutions, Essential & Green Materials, ICT & Mobility Solutions) reflects improved operational efficiency, product mix optimization, and R&D-driven new product launches (e.g., Orgovyx, Gemtesa, INDIFLIN), supporting the potential for higher long-term revenue and net margins.
Curious what kind of revenue path, margin rebuild, and future earnings multiple are baked into that fair value, and how tightly those assumptions are calibrated? The full narrative lays it out without holding back on the details.
Result: Fair Value of ¥529.18 (OVERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, there are still watchpoints, including pressure in petrochemicals and inventory build ups in Agro & Life Solutions, that could challenge the current fair value story.
Find out about the key risks to this Sumitomo Chemical Company narrative.
If you set the narrative fair value aside and just look at the current P/E of 9x, the picture shifts. The wider JP Chemicals industry sits at 13.8x and close peers at 26.6x, while our fair ratio suggests 17x is a level the market could move toward.
That gap can either be read as valuation risk if earnings fade, or an opening if profits simply hold up and sentiment normalises.
See what the numbers say about this price — find out in our valuation breakdown.
TSE:4005 P/E Ratio as at Feb 2026
If you read this and come to a different conclusion, or simply want to test your own assumptions against the numbers, you can build a complete narrative for Sumitomo Chemical in just a few minutes, Do it your way.
A great starting point for your Sumitomo Chemical Company research is our analysis highlighting 4 key rewards and 3 important warning signs that could impact your investment decision.
If this story has sharpened your thinking, do not stop here, the screener can quickly surface other companies that fit the kind of profile you care about.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include 4005.T.
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